EXHIBIT 10.19(c)
SEPARATION AGREEMENT
This SEPARATION AGREEMENT (this "Agreement") made as of November 21,
2002, by and among Xxxxxx Xxxxxx (the "Executive"), ON Semiconductor Corporation
and Semiconductor Components Industries, L.L.C. (collectively, the "Company").
WHEREAS, the Company engaged the Executive to be Chief Executive
Officer and President of the Company, a member of the Board of Directors of ON
Semiconductor Corporation (the "Parent Board") and a member of the Board of
Directors of Semiconductor Components Industries, L.L.C., (the "Board") pursuant
to an Employment Agreement among the Executive and the Company dated October 27,
1999, as amended on April 25, 2002 (the "Employment Agreement");
WHEREAS, the Executive's employment with the Company has been
terminated and the Executive wishes to resign his positions as a member of the
Parent Board and the Board, in each case, effective as of November 19, 2002, in
accordance with this Agreement; and
WHEREAS, all defined terms used in this Agreement that are not
otherwise defined herein shall have the meanings ascribed to such terms in the
Employment Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and promises contained herein and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the Company and the
Executive hereby agree as follows:
1. Termination of Employment
The parties hereto hereby agree that the Executive's employment with
the Company and its affiliates has terminated and the Executive hereby resigns
as a member of the Parent Board and the Board, in each case, effective November
19, 2002 (the "Termination Date"). The Executive hereby resigns effective as of
the Termination Date from all other positions, offices or other affiliations,
that he holds in connection with the Company and its affiliates. The Executive
shall execute any forms of resignation or other documents reasonably requested
by the Company in order to carry out the provisions of this Agreement.
2. Termination Payments and Other Benefits
(a) Pursuant to Section 5(a) of the Employment Agreement,
the Company shall pay the Executive US$ 1,500,000 (the "Severance Payment") on
or as soon as practicable after January 1, 2003 (but in no event later than
January 10, 2003), provided that, notwithstanding the foregoing, no payment
shall be made prior to the Effective Date of this Agreement.
(b) The Company shall pay the Executive any Base Salary
accrued but not yet paid through the Termination Date and any accrued but unused
vacation and shall reimburse the Executive for any reasonable business expenses
incurred on or prior to the Termination Date and properly substantiated within
thirty days after the Termination Date in accordance with the Company's
customary expense reimbursement procedures.
(c) The Option shall become immediately exercisable as to
all shares covered thereby as of the Termination Date and shall remain
exercisable until the first to occur of (i) the second anniversary of the
Termination Date and (ii) the tenth anniversary of the grant date of such
Option. With respect to all other options to purchase stock of the Company
granted by the Company to the Executive, (x) all such stock options that are by
their terms exercisable as of the Termination Date shall remain exercisable
until the first to occur of (A) the second anniversary of the Termination Date
and (B) the tenth anniversary of the grant date of such options, at which time
such options shall terminate and (y) all such stock options that are not
exercisable as of the Termination Date shall terminate as of the Termination
Date.
(d) If the Executive elects continuation of health
insurance benefits as provided under Section 4980B of the Internal Revenue Code
of 1986 and Section 601 of the Employee Retirement Income Security Act of 1974,
as amended (which provisions are commonly known as "COBRA"), the Company shall
pay the cost of such COBRA benefits for a period not to exceed eighteen months.
(e) The Company shall promptly reimburse Executive for
reasonable attorney's fees and costs incurred in connection with the Executive's
separation from the Company and the preparation of this Agreement not to exceed
$2,000.
(f) All payments and benefits provided in Sections 2(a),
2(c), 2(d) and 2(e) shall be referred to herein as the "Termination Payments".
The Termination Payments shall be reduced by any required tax withholdings. The
Termination Payments shall not be taken into account as compensation and no
service credit shall be given after the Termination Date for purposes of
determining the benefits payable under any other plan, program, agreement or
arrangement of the Company. The Executive acknowledges that, except for the
Termination Payments, he is not entitled to any payment in the nature of
severance or termination pay from the Company.
3. General Release and Waiver
(a) In consideration of payment of the Termination
Payments provided herein, the Executive hereby releases, remises and acquits the
Company and all of its affiliates, and their respective officers, directors,
shareholders, members, family members, agents, employees, consultants,
independent contractors, attorneys, advisers, successors and assigns
(collectively, the "Releasees"), jointly and severally, from any and all claims,
known or unknown, which the Executive or the Executive's heirs, successors or
assigns have or may have against any of such parties arising on or prior to the
date of this Agreement and any and all liability which any of such parties may
have to the Executive, whether denominated claims, demands, causes of action,
obligations, damages or liabilities arising from any and all bases, however
denominated, including but not limited to the Age Discrimination in Employment
Act, the Americans with Disabilities Act of 1990, the Family and Medical Leave
Act of 1993, Title VII of the United States Civil Rights Act of 1964, 42 U.S.C.
Section 1981, as well as any state or local laws, including without limitation
the Arizona Civil Rights Act and the Arizona Employment Protection Act, or any
other national, state, or local law and any workers' compensation or disability
claims under any such laws. This General Release and Waiver relates to any and
all claims, including without limitations claims arising from and during the
Executive's relationship with the Company, any stock option, equity-based or
other incentive plans, or as a result of the termination of such
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relationship and the cancellation of any such stock options or equity awards.
The Executive further agrees that the Executive will not file or permit to be
filed on the Executive's behalf any such claim. Notwithstanding the preceding
sentence or any other provision of this Agreement, this release is not intended
to interfere with the Executive's right to file a charge with the Equal
Employment Opportunity Commission or any state human rights commission in
connection with any claim he believes he may have against the Company. However,
by executing this Agreement, the Executive hereby waives the right to recover in
any proceeding the Executive may bring before the Equal Employment Opportunity
Commission or any state human rights commission or in any proceeding brought by
the Equal Employment Opportunity Commission or any state human rights commission
on the Executive's behalf. This release is for any relief, no matter how
denominated, including, but not limited to, injunctive relief, wages, back pay,
front pay, compensatory damages, or punitive damages. This General Release and
Waiver shall not apply to any obligation of the Company pursuant to this
Agreement.
(b) The Executive expressly understands and agrees that
the General Release and Waiver set forth in Section 3(a) above fully and finally
releases and forever resolves the claims released and discharged therein,
including those which may be unknown, unanticipated and/or unsuspected. The
Executive further acknowledges that he is aware that he may hereafter discover
facts in addition to or different from those which he now knows or believes to
exist with respect to the subject matter of this Agreement, but that it is his
intention to hereby fully, finally and forever settle and release all of the
claims, known or unknown, anticipated or unanticipated, suspected or
unsuspected, which now exist, may exist or heretofore have existed between or
among himself and the Releasees.
(c) The Executive acknowledges that the Termination
Payments the Executive is receiving in connection with the foregoing release is
in addition to anything of value to which the Executive already is entitled from
the Company.
4. Restrictive Covenants
The Non-Solicitation, Confidentiality, Non-Disclosure and
Non-Disparagement provisions contained in Section 8 and 9 of the Employment
Agreement shall remain in full force and effect in accordance with their terms.
5. Confidentiality of Agreement
The Executive shall keep the terms of this Agreement confidential and
shall not directly or indirectly disseminate any information (in any form)
regarding this Agreement to any person or entity except as may be agreed to in
writing by the Company. Notwithstanding the foregoing, the Executive may
disclose the information described herein, to the extent the Executive is
compelled to do so by lawful service of process, subpoena, court order, or as
the Executive is otherwise compelled to do by law, including full and complete
disclosure in response thereto, in which event the Executive agrees to provide
the Company with a copy of the document(s) seeking disclosures of such
information promptly upon receipt of such document(s) and prior to disclosure by
the Executive of any such information, so that the Company may, upon notice to
the Executive, take such action as it deems to be necessary or appropriate in
relation to such subpoena or request.
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6. Certain Forfeitures in Event of Breach
The Executive acknowledges and agrees that, notwithstanding any other
provision of this Agreement, in the event the Executive materially breaches any
of his obligations under this Agreement or the Restrictive Covenants provided in
the Employment Agreement and referenced in Section 4 of this Agreement, the
Executive will forfeit his right to receive the Termination Payments provided by
Section 2 of this Agreement to the extent not theretofore paid to him as of the
date of such breach and, if already made as of the time of breach, the Executive
agrees that he will reimburse the Company, immediately, for the amount of such
payment.
7. No Admission
This Agreement does not constitute an admission of liability or
wrongdoing of any kind by the Company or its affiliates or by the Executive.
8. Heirs and Assigns
The terms of this Agreement shall be binding on the parties hereto and
their respective successors and assigns. In the event of the Executive's death
prior to the date any of the payments provided hereunder become due and payable,
such amounts shall be paid to the Executive's beneficiaries or estate, as
applicable, to the extent they would otherwise have been payable to the
Executive.
9. General Provisions
(a) This Agreement and the Restrictive Covenants provided
in the Employment Agreement and referenced in Section 4(a) of this Agreement
constitute the entire understanding of the Company and the Executive with
respect to the subject matter hereof and supersedes all prior understandings,
written or oral. The terms of this Agreement may be changed, modified or
discharged only by an instrument in writing signed by the parties hereto. A
failure of the Company or the Executive to insist on strict compliance with any
provision of this Agreement shall not be deemed a waiver of such provision or
any other provision hereof. In the event that any provision of this Agreement is
determined to be so broad as to be unenforceable, such provision shall be
interpreted to be only so broad as is enforceable.
(b) This Agreement shall be governed by and construed in
accordance with the laws of the State of Arizona, without reference to its
principles of conflicts of law. All actions and proceedings relating directly or
indirectly to this Agreement shall be commenced in Maricopa County, Arizona, and
the parties hereby submit to the exclusive jurisdiction of such courts and waive
any claim of forum non conveniens; provided that notwithstanding the foregoing,
the Company may commence an action related to, or seek enforcement of, the
Restrictive Covenants provided in the Employment Agreement and referenced in
Section 4 of this Agreement in any jurisdiction.
(c) The parties hereto acknowledge and agree that each
party has reviewed the terms and provisions of this Agreement and has had the
opportunity to contribute to its revision. Accordingly, the rule of construction
to the effect that ambiguities are resolved against the drafting party shall not
be employed in the interpretation of this Agreement. Rather, the terms of this
Agreement shall be construed fairly as to both parties hereto and not in favor
or against
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either party. The headings in this Agreement are inserted for convenience of
reference only and shall not be part of or control or affect the meaning of any
provision hereof. Terms used in the singular shall include the plural and terms
used in one gender shall include the other, in each case, as the context
requires.
(d) This Agreement may be executed in any number of
counterparts and by different parties on separate counterparts, each of which
counterpart, when so executed and delivered, shall be deemed to be an original
and all of which counterparts, taken together, shall constitute but one and the
same Agreement. A facsimile of a signature shall be deemed to be and have the
affect of an original signature.
(e) All obligations of the Company to indemnify Executive
pursuant to the Company's charter, by-laws or other related documents or under
any applicable law shall remain in full force and effect, except as they may be
amended from time to time with respect to the Company's officers and directors
generally.
10. Knowing and Voluntary Waiver
The Executive acknowledges that, by the Executive's free and voluntary
act of signing below, the Executive agrees to all of the terms of this Agreement
and intends to be legally bound thereby.
The Executive understands that he may consider whether to agree to the
terms contained herein for a period of twenty-one days. The Executive
acknowledges that he received this Agreement on November 21, 2002, and has had
an opportunity to review and consider the terms contained in this Agreement.
However, the Termination Payments provided herein shall not commence until this
Agreement is executed and returned to the Company, and becomes effective on the
Effective Date as provided below. The Executive acknowledges that he has been
advised to consult with and has consulted with an attorney prior to executing
this Agreement.
This Agreement will become effective, enforceable and irrevocable on
the eighth day after the date on which it is executed by the Executive, provided
it is not revoked by the Executive as provided below (the "Effective Date").
The Executive may revoke his agreement to accept the terms hereof by
delivering a letter within seven days after he has executed this Agreement
addressed to the Company at its corporate offices to the attention of Xxxxx
Xxxx, with a copy to Xxxxxx X. Xxxxxxx, Cleary, Gottlieb, Xxxxx & Xxxxxxxx, Xxx
Xxxxxxx Xxxxx, Xxx Xxxx, XX 00000, specifying his intention to revoke his
agreement. If the Executive exercises his right to revoke hereunder, he shall
forfeit his right to receive any of the Termination Payments and benefits
provided for herein, and to the extent such payments have already been made, the
Executive agrees that he will immediately reimburse the Company for the amounts
of such payment and the parties' obligations under this Agreement, including
without limitation, the General Release and Waiver provided in Section 3 hereof,
shall become null and void ab initio and the Executive shall retain any and all
claims that he may have had against the Company prior to the execution of this
Agreement.
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ON SEMICONDUCTOR CORPORATION &
SEMICONDUCTOR COMPONENTS
INDUSTRIES, L.L.C.
/s/ XXXXX XXXX
-----------------------------------
Name: Xxxxx Xxxx
Title: Vice President and Secretary
/s/ XXXXXX XXXXXX
-----------------------------------
Xxxxxx Xxxxxx
Acknowledgment
STATE OF ARIZONA )
) ss:
COUNTY OF MARICOPA )
On the 9th day of December, 2002, before me personally came
Xxxxxx Xxxxxx the Executive who, being by me duly sworn, did depose and say that
he resides at 0000 X. Xxxxxxxxxx, Xxxxxxxx Xxxxxx, XX 00000; and did acknowledge
and represent that he has had an opportunity to consult with attorneys and other
advisers of his choosing regarding the Separation Agreement attached hereto,
that he has reviewed all of the terms of the Separation Agreement and that he
fully understands all of its provisions, including, without limitation, the
general release and waiver set forth therein.
/s/ XXXXX X. XXX
----------------------
Notary Public
Date: December 9, 2002
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